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Iranian President Mahmoud Ahmadinejad has said his country is proposing a loan to Egypt, despite international economic sanctions imposed on Iran over its nuclear program, state-run Al-Ahram reported Wednesday.

Al-Ahram reported Ahmadinejad as saying he had previously announced that Iran could extend financial aid and other services to Egypt.

Egypt said on Tuesday that its foreign reserves had fallen below US$15 billion, despite a loan from Qatar to support the economy.

Ahmadinejad is in Cairo for the Organization of Islamic Cooperation summit and for meetings with Morsy and other officials. He is the first acting head of state to visit Egypt since the two nations severed diplomatic ties in 1979.

Ahmadinejad said in the Al-Ahram interview that no great progress has been made regarding the resumption of diplomatic relations between Tehran and Cairo.

“No change was made over the past two years. However, talks developed and grew as President Mohamed Morsy visited Iran, when we met,” Ahmadinejad said, referring to Morsy's visit in August.

Among the obstacles that hinder the restoration of ties is an Iranian street named after the man responsible for assassinating former Egyptian President Anwar al-Sadat in 1981.

Ahmadinejad reportedly told Al-Ahram that the issue would be dealt with gradually.

The Iranian leader also added that his country's economy was affected by sanctions, but that exports are gradually growing.

Western powers have repeatedly tried to deter Iran's nuclear ambitions by clamping down on oil exports from the country, an important source of its revenue. Iran has insisted that it is developing nuclear technology for peaceful aims.